Prefer Firstsource Solutions, says Mahantesh Sabarad

Mahantesh Sabarad, Deputy Head of Research at SBI-Cap Securities told CNBC-TV18, "In Firstsource Solutions we see increasing traction in terms of margins going forward. They have achieved something like 12.5-12.3 percent EBITDA margins for the latest Q2 results. By the time it will be Q4, they should be somewhere around 13.5 times in terms of EBITDA margin. So there will be a rising momentum in terms of margin."

"At the same time, this is one company, which will see off its old legacy debts being repaid. So we will have huge amount of cash generation from the company that is why we like the stock," he added.

At 12:23 hrs Firstsource Solutions was quoting at Rs 32.75, down Rs 0.50, or 1.50 percent on the BSE.

Disclosure: Analyst and his firm doesn't hold the above stock.